The Islamic Banking Activities

In order to satisfy the needs of the customers who don’t want to deal with the normal banking, PBDAC management approved opening Islamic banking branches and village banks so as to offer Islamic banking products and to expand the customers’ base of the bank. In 1987, the bank opened two Islamic banking branches: one in Upper Egypt and the other in Lower Egypt to satisfy the needs of the customers in these areas. Based upon the results achieved by these two branches, the CBE approved to transfer normal banking premises into Islamic banking branches. Therefore, the number of Islamic banking branches reached 18 branches/village banks all over Egypt by 2012. Currently, it is planned to open six new Islamic banking branches before the end of 2013.

There is an Islamic banking branch in almost every governorate all over Egypt to offer the Islamic banking services under full supervision from The Sharia Supervisory Board that is consisted of Islamic Shari’a scholars and legal practitioners to set the Sharia regulations of the Islamic Banking transactions, review the activities carried out by the bank, make sure that these activities are complying with the Islamic Shari’a and to give the Sharia opinion about the transactions of these Islamic branches.

The Islamic banking branches have to abide by the following main regulations in their transactions:

– Offering deposits with almost the same privileges offered by the competitors to be able to mobilize customers.
– Offering different types of Islamic investment products, in accordance with the Islamic Shari’a, to satisfy the needs of customers (retail, Murabaha…etc) so that the bank can invest these deposits in accordance with the Shari’a rules.
– Establishing a Debtors Fund to cover risks and to achieve the social solidarity.
– Full separation between the normal banking deposits and the Islamic banking deposits.
– Offering the highest revenues on deposits, according to the achieved results at the end of the fiscal year.
– PBDAC distributes 2.5% of its yearly profits (Zakah) to the associations and hospitals that accept charities.
– The Shari’a Supervisory Board fully supervises all transactions.